Archive for April, 2009

On 18 March 2009 there was a Matter of Public Importance debated in the Australian Parliament.

The topic was Regional Australia, and the discussion ranged over hill and dale. Gary Gray (the relevant Parliamentary Secretary) said that ‘the spark of energy and the life that is created in good regional centres comes down so often to a grumpy sense of self-reliance that healthy communities have. Take a township like Merredin, with its pride in its public gardens and its swimming pools…’ and so it went.

It has now dawned on us – ‘grumpy self-reliance’ might be the feds’ strategy on regional development! The Regional Development Program has been closed, and the feds pulled out of regional investment attraction five years ago.

Although the new dawn begins on 1 July with the new RDA machinery, my grumpy contacts say there will be minimal regional funding thanks to the $42 billion GFC package and $3.3 billion committed to roof insulation!! More grumpy self-reliance?

This has come out of the blue – $650 million Jobs Fund announced by the Rudd Government to support local jobs, build skills and improve facilities in local communities. It is part of the Rudd Government’s Jobs and Training Compact – includes three streams:

§$300m for Local Jobs to invest in community projects of up to $2 million to protect the environment or promote sustainability – $60m for community heritage projects, $40m for commuter bike paths.

§$200m to Get Communities Working – to invest in local council and not-for-profit projects of up to $2 million to upgrade vital community facilities and build community capacity.

§$150m for Infrastructure Employment Projects – to be initiated by the Australian Government for local infrastructure that creates immediate jobs in communities affected by the downturn.

A wonderful story from Joanna van Walraven, the retail coordinator from Hutt City Council.

Frustrated at the shabby run down appearance of the Naenae Shopping Centre, Joanna focused on the resources and assets of the local community.

She organised a ‘Paint-a-thon’ with the aim of painting 20 (roughly half of the shops) using community volunteers and donated paint and resources. The result was an incredible turnout from the community, who achieved a quality job. The shopping centre now looks fantastic.

Click here to download an article and photos from the local newspaper.

‘Higher, more effective and efficient investments in education, research and innovation are a key factor for the sustainable long-term growth of a competitive European economy and should remain a high priority’ – this is one of the recommendations adopted by EU research ministers at the Competitiveness Council meeting in Brussels, Belgium on 5 and 6 March.

The Ministers also highlight the importance of reaching the goal of investing 3% GDP in R&D.

Elsewhere in the recommendations, the ministers call on Member States to encourage universities, research institutes and industry to ‘step up their cooperation’; the European Institute for Innovation and Technology (EIT) will play a key role in achieving this goal.

According to the ministers, the role of frontier research needs to be ‘reinforced’. Furthermore, as the ministers noted, the review of the structures and mechanisms of the European Research Council (ERC) should be a priority.

The Ministers unanimously adopted over 30 recommendations and key messages on how Europe should respond to the current economic downturn. Got to http://www.eu2009.cz/en/

A recent study for the U.S. Department of Commerce EDA shows that business incubators provide communities with significantly greater results at less cost than other type of public works infrastructure.

Researchers found that business incubators are the most effective means of creating jobs – more effective than roads, bridges, industrial parks, commercial buildings, water projects – incubators provide up to 20 times more jobs than community infrastructure projects – at a cost of $144 to $216 per job compared with $2,920 to $6,872 for the latter.

Another EDA-funded study in the mid-1990s found that 87 percent of all firms that had graduated from NBIA member incubation programs were still in business. NBIA estimates that in 2005 alone, North American incubators assisted 27,000+ start-up companies with full-time employment of 100,000+.

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The Public Broadcasting System began its Nightly Business Report in 1979. In celebration of their 30th year on American TV, they partnered with Knowledge@Wharton to identify “The Top 30 Innovations of the Last 30 Years.”

NBR viewers nominated their favourites during the 1979 to 2009 time frame. Professors at The Wharton School of the University of Pennsylvania ranked the top thirty.

“Latin American companies have fallen through the cracks,” says Lourdes Casanova, a lecturer in strategy at INSEAD and author of Global Latinas: Latin America’s emerging multinationals.

“Latin America has been undersold. This book wants to celebrate the success of the region and its multinationals.” Since 2002, Latin American firms have expanded aggressively on a global scale and investment in foreign countries has jumped accordingly. And commodities now account for less than 30%, with a range of products now accounting for the rest – IT services, steel, electricity, wine, cosmetics, oil and gas.

Until 1980, Latin American countries were the emerging market of choice. Brazil and Mexico had China-like growth. But during the 1980s (the ‘lost decade’ due to the debt crisis) the region’s growth stalled as Russia, China and India stepped up. Prompted by the strict policies imposed in the 1990s by the IMF and World Bank, Latin American governments began the privatisation of state companies, deregulation and tariff cuts.

The deregulation brought a wave of foreign multinationals to compete against domestic firms. Latin American companies had to grow and expand internationally. “These companies had been growing in a protected environment before this,” Casanova says. “Now they felt threatened by foreign multinationals competing against them in their own region. The best defense was to attack.” During the 1990s, Latin American firms grew domestically and expanded into nearby regions and/or with the same language and shared history. NAFTA smoothed the way and enabled cross-border acquisitions. Now they are entrenched.

A new book, “The Emergence of the Hardware and Software Industries in China and India”, presents the first rigorous comparison of the growth of the IT industries in China and India.

Based on interviews with 300+ companies. Explains the different growth paths of the software and hardware sectors, and why India is the software capital of the world while China is a manufacturing powerhouse.